Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 1 of 7
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`YAR R. CHAIKOVSKY (SB# 175421)
`yarchaikovsky@paulhastings.com
`PHILIP OU (SB# 259896)
`philipou@paulhastings.com
`ANDY LEGOLVAN (SB# 292520)
`andylegolvan@paulhastings.com
`JOSEPH J. RUMPLER, II (SB# 296941)
`josephrumpler@paulhastings.com
`BERKELEY FIFE (SB# 325293)
`berkeleyfife@paulhastings.com
`BORIS LUBARSKY (SB# 324896)
`borislubarsky@paulhastings.com
`PAUL HASTINGS LLP
`1117 S. California Avenue
`Palo Alto, California 94304-1106
`Telephone: 1(650) 320-1800
`Facsimile: 1(650) 320-1900
`Attorneys for Plaintiff
`APPLIED MATERIALS, INC.
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`
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF CALIFORNIA
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`APPLIED MATERIALS, INC.,
`Plaintiff,
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`vs.
`DEMARAY LLC,
`Defendant.
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`
`CASE NO. 5:20-cv-05676-EJD
`APPLIED MATERIALS, INC.’S
`OPPOSITION TO DEMARAY LLC’S
`ADMINISTRATIVE MOTION TO
`FILE SUR-REPLY TO APPLIED’S
`MOTION FOR PRELIMINARY
`INJUNCTION
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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`Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 2 of 7
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`Applied Materials, Inc. (“Applied”) submits this Opposition to Demaray LLC’s
`(“Demaray”) Administrative Motion for Leave to File a Sur-Reply to Applied’s Motion for
`Preliminary Injunction, Dkt. No. 30 (“Motion”).
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`INTRODUCTION
`Demaray’s Motion is Demaray’s second improper attempt to have “the last word” on
`Applied’s Motion for Preliminary Injunction. Dkt. No. 14 (“Injunction Motion”). On October
`16, 2020, Demaray filed objections to allegedly “new” evidence submitted by Applied in its
`Reply, Dkt. No. 29 (“Objections”), but failed to apply the standard for what is considered “new.”
`Applied’s Reply evidence is not “new” because it was submitted in direct response to evidence
`and arguments raised in Demaray’s Opposition. For example, Demaray raised subject-matter
`jurisdiction for the first time in its Opposition by arguing that Demaray never offered Applied a
`license. In direct response, Applied submitted evidence to the contrary. Demaray now argues
`that this evidence should have been submitted in Applied’s Injunction Motion, ignoring that it
`was Demaray—not Applied—who first raised subject-matter jurisdiction in its Opposition.
`Demaray does the same with other Article III arguments, including the nature of its allegations
`against Applied’s customers, and merits based arguments regarding Applied’s causes of action,
`all of which Applied properly responded to in its Reply. By objecting to Applied’s purportedly
`“new” evidence and separately seeking leave to file a sur-reply, Demaray seeks to have both (1)
`its arguments and evidence unrebutted and (2) the last word. Neither is fair or proper under the
`Court’s Local Rules considering the evidence Applied submitted was not “new.”
`As Demaray notes, counsel for the parties conferred, and to avoid burdening the Court
`with the instant papers, Applied offered to not oppose a limited sur-reply of five pages solely to
`address the evidence in Applied’s Reply (i.e., not a carte blanche to address any issue raised in
`the Reply). Demaray declined and proceeded with the instant Motion, presumably because it
`seeks the last word on every argument and issue addressed in Applied’s Reply.1 At the same
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`1 Applied asked what Demaray contends to be “new arguments and supporting evidence”
`warranting a sur-reply, and Demaray effectively responded that the entirety of Applied’s Reply
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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`Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 3 of 7
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`time, Demaray refused to allow Applied to file a response to the Objections to explain why the
`evidence submitted in its Reply was not “new.” Ex. B to Lubarsky Decl. For the same reasons
`why a sur-reply is not warranted, the Objections should be overruled. Briefing on Applied’s
`Injunction Motion is closed and Demaray has not demonstrated why it should be permitted a 10-
`page sur-reply on whatever it chooses to respond to from Applied’s Reply.
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`LEGAL STANDARD
`“Courts may allow evidence first presented in a reply if it ‘addresse[s] the same set of
`facts supplied in [the] opposition to the motion’ or when it is ‘submitted in direct response to
`evidence raised in the opposition.’ In such circumstances the evidence is not considered ‘new.’”
`WeRide Corp. v. Kun Huang, No. 5:18-cv-07233-EJD, 2019 U.S. Dist. LEXIS 22915, at *3–5
`(N.D. Cal. Feb. 12, 2019) (Davila, J.) (emphasis added) (quoting Rayon-Terrell v. Contra Costa
`Cty., 232 F. App’x 626, 629 n.2 (9th Cir. 2007), and Advanced Media Networks LLC v. Row 44
`Inc., 2014 U.S. Dist. LEXIS 156649, at *1 (C.D. Cal. Nov. 4, 2014) (such evidence is “not
`new”)); see also Laub v. Horbaczewski, No. CV 17-6210-JAK (KSx), 2020 U.S. Dist. LEXIS
`158171, at *3–5 (C.D. Cal. June 24, 2020) (declaration submitted with reply brief “does not
`present new factual contentions but responds to arguments Plaintiffs raised in their Opposition”).
`The moving party is permitted to file declarations in support of a reply brief, see L.R. 7-
`3(c) (“Any reply to an opposition may include affidavits or declarations[.]”), and the non-moving
`party may file objections to such evidence, see L.R. 7-3(d)(1). A sur-reply should generally only
`be permitted if the evidence submitted with the reply brief is considered “new” evidence under
`the appropriate standard, thus warranting an opportunity to respond; however, if the evidence
`submitted with the reply brief only responds to evidence and argument made in the opposition
`brief, there is no basis for a sur-reply. WeRide Corp., 2019 U.S. Dist. LEXIS 22915, at *3–5;
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`was “new,” identifying every issue addressed in the Reply, including “issues of comity and the
`applicable legal standard for a preliminary injunction.” Ex. A to Lubarsky Decl. Demaray’s
`position is undermined by the limited objections it filed, which—to the extent the Court permits
`one—should dictate the bounds of any sur-reply by Demaray.
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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`II.
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`Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 4 of 7
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`Yowie North America, Inc. v. Candy Treasure, LLC, No. 13-CV-1906 BEN (JMA), Dkt. No. 51 at
`1–2 (S.D. Cal. Dec. 9, 2013) (denying sur-reply because “a review of the Reply as well as the
`supporting declarations reveals that the evidence submitted is not new evidence, but rather is
`responsive to the arguments raised in the opposition brief”); see also Earth Island Inst. v. Nash,
`No. 1:19-cv-01420-DAD-SAB, 2020 U.S. Dist. LEXIS 71185, at *20 (E.D. Cal. Apr. 21, 2020).
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`III. ARGUMENT
`Demaray identifies four categories of “new arguments,” tracking the allegedly “new”
`evidence identified in its Objections. See Mot. at 1–2. However, Applied properly raised these
`arguments in its Reply directly in response to the arguments raised in Demaray’s Opposition.
`First bullet point: Demaray’s offer to license the Asserted Patents. This is not “new.”
`Demaray first raised subject-matter jurisdiction in its Opposition, including by submitting Mr.
`Demaray’s declaration and asserting that he “never approached Applied about licensing the
`Demaray patents.” Opp. at 5. To respond to this evidence, Applied submitted correspondence
`with its Reply showing that Mr. Demaray did, in fact, offer to license the Asserted Patents—thus
`demonstrating Demaray’s assertion was false. Reply at 2. This evidence is therefore not “new”
`because it was submitted in direct response to evidence raised in Demaray’s Opposition.2
`Second bullet point: The relationship between Applied and its customers. As
`explained, Demaray first raised subject-matter jurisdiction in its Opposition, claiming that the
`customer suits are not accusing Applied or Applied’s products, but rather only Samsung and
`Intel’s alleged configurations. Opp. at 5–8. Applied properly responded to that argument with
`evidence (e.g., declarations) clarifying the reality of the nature of Applied’s supply/manufacturing
`relationship with its customers and what products/services are provided to them with respect to
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`2 Demaray also incorrectly asserts that Applied bases subject-matter jurisdiction on Demaray’s
`offer to license the Asserted Patents. Not so. The allegations in Demaray’s customer suits
`establish jurisdiction. See Reply at 3–6. Applied submitted Demaray’s email license offer to
`correct the record after Demaray represented to the Court that no offer had been made, id. at 2,
`although such evidence lends further support to finding jurisdiction, id.
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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`Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 5 of 7
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`the reactors utilized by Applied’s customers as alleged in the customer suits.3 Reply at 5. This
`evidence was necessary to rebut the new argument in Demaray’s Opposition and to establish that
`subject-matter jurisdiction exists because Demaray’s customer suits necessarily include an
`implied assertion of infringement against Applied. See id. at 2–6. This evidence is therefore not
`new because it addresses the same set of facts supplied in Demaray’s Opposition.
`Third bullet point: Employment agreement of Mukundan Narasimhan. This is not
`“new.” Applied’s Motion, unlike a traditional preliminary injunction motion, is procedural in
`nature, and, following Federal Circuit precedent from Katz v. Lear Siegler, Inc. 909 F2d 1459
`(Fed. Cir. 1990), raises the question of whether this action will resolve “major issues” in
`Demaray’s customer suits. Applied’s Motion does not present merits questions of whether
`Applied or Demaray has a “likelihood of success” on the merits. See Mot. at 7; Reply at 7.
`Therefore, Applied did not have to “prove up” the merits of the underlying claims, but instead
`properly referred to the contents of the assignment provisions recited in the Amended Complaint,
`including Mr. Narasimhan’s assignment provision. Dkt. No. 13 ¶¶ 25, 29, 31, 36, 40, 41.
`In its Opposition, however, Demaray injected the new argument that the Supreme Court in
`eBay made “likelihood of success” relevant to all injunctions, even those that are procedural in
`nature under Katz. See Opp. at 10–11, 22–23. Further, Demaray made a lengthy substantive
`merits argument as to why the assignment provisions are allegedly unlawful. Opp. at 11–14.
`While Applied disagrees that the merits should be addressed in its Motion, and believes that
`alleging the contents of the assignment provisions is sufficient, Applied submitted an exemplar
`agreement with its Reply out of an abundance of caution to respond to the merits arguments in
`Demaray’s Opposition. Reply at 12. The assignment agreement therefore is not “new” because
`the primary provisions were already known (they were alleged in Applied’s Amended Complaint)
`and because it addresses the same set of facts supplied in Demaray’s Opposition.
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`3 Not surprisingly, Demaray has refused to provide its infringement contentions against Samsung
`and Intel to Applied or the Court to assess the veracity of Demaray’s claims that the customer
`suits are directed to the customers’ “alleged configurations.” Ex. C to Lubarsky Decl.
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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`Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 6 of 7
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`Fourth bullet point: Location of relevant Samsung and Intel activities. Applied
`argued it was more convenient to litigate in this District because of Demaray, Applied, Intel, and
`Samsung’s significant presence in this District. Mot. at 18. Demaray countered by identifying
`Applied, Intel, and Samsung’s Austin facilities, suggesting that relevant evidence and witnesses
`are located there. Opp. at 24 (citing online sources). Applied properly responded with evidence
`(declarations) clarifying where the relevant activities take place (and thus, where the relevant
`evidence and witnesses are located). Reply at 14. This evidence is therefore not “new” because it
`were submitted in direct response to evidence raised in Demaray’s Opposition.4
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`IV. CONCLUSION
`The evidence and arguments Demaray identifies as “new” was only raised to respond to
`evidence and argument that Demaray injected into the proceedings in its Opposition. Applied
`properly responded in its Reply, including with rebuttal evidence. Under such circumstances,
`there is no basis for a sur-reply. But, to the extent a sur-reply is permitted, Applied submits that a
`10-page brief is excessive and that appropriate limitations should be imposed: (1) limited to five
`pages, (2) limited only to responding to evidence submitted with the Reply (i.e., not carte blanche
`to respond to any issue raised in the Reply), and (3) filed with sufficient time to preserve the
`November 12, 2020 hearing date. Moreover, Demaray’s Objections should be overruled.
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`4 Demaray makes a form-over-substance numerosity argument regarding the “seven new fact
`declarations,” Mot. at 1, but fails to note the number of declarations required was, in part, due to
`Demaray’s decision to sue indiscriminately four separate Samsung entities, requiring agreement
`from each of the four Samsung entities (plus Intel) to be bound by the result of this action. Reply
`at 9. Demaray also suggests Applied added “three additional, brand-new declarations,” Mot. at 1,
`with a corrected Reply. The declarations were cited in Applied’s original Reply, but were
`inadvertently omitted from the actual filing due to a clerical error. Applied promptly informed
`Demaray and, per the clerk’s instructions, filed a “corrected” Reply (with no changes) with the
`inadvertently omitted declarations.
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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`Case 5:20-cv-05676-EJD Document 31 Filed 10/23/20 Page 7 of 7
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`DATED: October 23, 2020
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`YAR R. CHAIKOVSKY
`PAUL HASTINGS LLP
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`By: /s/ Yar R. Chaikovsky
`YAR R. CHAIKOVSKY
`Attorneys for Plaintiff
`APPLIED MATERIALS
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`APPLIED’S OPP. TO DEMARAY’S
`ADMIN. MOT. FOR SUR-REPLY
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